Business

FINANCE: How to make reasonable bargains during buying or selling

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Yusuf Boluwatife

 

 

Trading, which is basically buying and selling, is one inevitable aspect of our day-to-day life. We buy or sell almost everyday.

An essential feature of “trading” for an average person is their power of bargaining because there is literally nothing like “cheating” in a typical African market.

From the sellers trying to sell their wares and make profit while retaining customers, to the buyers looking to buy quality goods without spending more than necessary. What is sold for a naira to one individual could be sold for a dollar to another, this boils down to the power of bargaining.

In this piece, BlackBox Nigeria shares two helpful techniques for making reasonable bargains.

 

• Down-up bargaining method

This method involves the seller of the goods or renderer of the service stating the initial price of his goods/services, then the buyer offers the amount he wants to pay for it.

However, the buyer names a reduced amount as his purchasing power i.e. the amount he is willing to pay. For example, a bottle of Coke is sold for N150, the buyer offers N50. During bargaining, the seller reduces the price while the buyer gradually increases his purchasing power. The seller beats the price “down” while the buyer “ups” his offer.

 

• Gradual down bargaining method

Here, the buyer and the seller beat prices down to reach a mutual agreement. This involves the seller stating the initial price of his goods/services while the buyer offers a slightly lower price with the intention that the former agrees to it. They bargain back and forth until both parties reaches an agreement.

For example, an artiste charges N50,000 for one hour of his service, the client beats the price down by N5,000. Let’s say the former agrees, the latter again offers a lesser amount until they both agree finally.

It could be seen that while the buyer beats down his purchasing power, the other party steps up his price, resulting in the “gradual-down” method of bargaining.

 

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